Cardano Sees 75% of Selling Pressure Disappear, 30% Rally Ahead?
Cardano (ADA) is preparing for a powerful rebound of around 30% as selling pressure has plunged to a six-month low, leaving behind the sharp decline that persisted over the past month.
Cryptocurrency analyst Ananda Banerjee wrote in an analysis published on February 9 (local time) that on-chain data shows selling incentives for Cardano have fallen by 75%. He explained that the share of Cardano supply in profit dropped from over 33% in mid-January to around 8% in early February, marking the lowest level in six months. As most holders have moved to break-even or loss positions, selling pressure for profit-taking has become extremely subdued.
From a technical perspective, an inverse head-and-shoulders pattern has formed on the 4-hour chart, signaling that the downtrend may be nearing its end. Banerjee assessed that if Cardano’s price successfully breaks above and holds the neckline in the $0.275 to $0.280 range, there is room for an additional upside of about 30%. Notably, between January 31 and February 9, prices declined while the Relative Strength Index trended upward, forming a bullish divergence that supports a gradual recovery in buying momentum.
On-chain activity data, specifically coin age consumed, is also sending positive signals. During the sharp sell-off on February 6, coin movements totaled around 168 million ADA, but this has recently fallen to about 92 million ADA, a decrease of roughly 45%. This suggests that long-term holders have halted panic selling and shifted to a wait-and-see stance, indicating that excess market supply is being absorbed. With selling pressure easing, even a modest inflow of buying demand could allow prices to spring upward relatively easily.
However, a full-fledged breakout will require support from trading volume. On-balance volume remains below its downward trendline, indicating that the recent rebound attempt has not yet been driven by strong demand. Banerjee noted that trading volume must surge again for Cardano to surpass the $0.275 resistance, and if successful, a path toward the next target of $0.346 would open. Should the $0.259 support level break, the bullish scenario would lose momentum.
Cardano is now facing a critical decision point amid favorable conditions, including fading selling pressure and the formation of a technical rebound pattern. As confidence in the Cardano ecosystem led by Charles Hoskinson and interest from institutional investors regain focus, whether the price can break above $0.275 is expected to be the key battleground for a potential 30% rally. Market participants are closely monitoring real-time trading data to see whether these strong reversal signals spotted near the end of the downtrend will translate into an actual price surge.
*Disclaimer: This article is for investment reference only, and no responsibility is taken for any investment losses based on it. The content should be interpreted solely for informational purposes.*
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